FNB, one of the largest banks in South Africa, estimates that it takes an average of 5 days for a middle-income consumer to spend up to 80% of their monthly salary. This suggests that the average middle-income consumer, earning between R180,000 ($11,194.94) – R500,000 ($31,090.75) per annum, survives on 20% of their monthly salary for more than 20 days in a month.
In addition, salaried middle-income consumers with secured and unsecured credit spend, on average, 30% of their income on unsecured credit and 35% on secured credit.
According to Raj Makanjee, CEO of FNB Retail, this is one of the indications that the average consumer is stretched financially.
“The trend also points to a continued culture of consumption, leaving consumers with little to start saving and investing for financial independence,” he says.
“In keeping with our efforts to help our customers better manage their money, we’ve invested heavily in the last decade in platform-based tools like our nav>> Money and our eBucks Rewards programme have provided immense support to customers, paying out over R16 billion (almost $1-billion) in the last 20 years,” Makanjee says.
Makanjee adds that as part of their commitment to providing integrated financial services through assisted and unassisted channels, they are also transforming their Retail offering to provide customers with integrated advice, helping them to unlock financial capacity in their lending and transactional activities to be able to save, invest, and protect themselves and their families.
“By democratising access to advice, we can assist more customers in securing a brighter financial future,” he says.
Senzo Nsibande, CEO of FNB Money Management says money management tools such as nav>> Money on the FNB App can be used for free and currently has more than 2 million active users.
“We’ve observed that Retail customers who use nav» Money on the FNB App are more likely to improve their credit, honour debit orders, and begin or increase their savings on hand. This is very encouraging because it demonstrates the potential of our tools in assisting customers manage their financial responsibilities,” explains Nsibande.
“By evaluating all aspects of their finances, consumers can stretch every rand beyond its potential. This may allow them to begin accumulating cash savings for emergencies and better plan for lifelong decisions such as a comfortable retirement,” Nsibande adds.
Edited by Zintle Nkohla
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